CONSERVATION
Government cackhandedness
in water management policy is money
ñ and water ñ down the drain

by Andrew Taylor
May 2004

Three years ago, in this column, I wrote that drinking water is provided centrally, consumed individually, but paid for communally - and thus treated as a free good. It therefore provided no incentive to restrain usage, and placed residents of apartment blocks in a prisoners' dilemma, where everyone realises it is in the collective interest to reduce consumption, but a fear that neighbours will simply free ride - and not reduce their usage, but still enjoy lower bills arising from the conservation efforts of others - maintains the status quo.

Since then, rarely a week has lapsed when the problem of how to structure payment for water and other utilities has not been in the news. So how has the introduction of metering changed the situation in the intervening three years?

In most countries when a water metering system is introduced the water company is obliged to provide, install and check the meters. This ensures that all meters are of the same performance standard, inspectors have the right of access to read the meter and that readings are fair and accurate. In Romania no such obligation exists - resulting in chaotic, disorganised and inevitably confrontational situations between residents of apartment blocks.

Following significant increases in prices for all utilities, during 2002 many residents took measures into their own hands and started installing water meters in a bid to escape the prisoners' dilemma and gain personal control over consumption costs of the resource. Unfortunately the seemingly reasonable demand by newly metered residents that they ought only to pay for the volume of water that they consumed was without legal basis and has created a raft of additional problems.

Back in 2002, block administrators were under no obligation to take account of the fact that a meter indicated that a family's bills ought to be lower than if calculated on the traditional communal division of costs. Yet even as the number of metered apartments grew geometrically the absence of meters provided by the water company at the entrance to each staircase (a defined communal unit within a block) meant that the water company could not assign unattributed consumption (losses) to a particular group of residents. The water companies have no interest in who consumes how much; rather they simply want the total amount leaving their plant to be paid for. Thus without stair meters they blocked the use of meters as well.

In Bucharest and some major cities the water companies have begun a programme of installing meters at the stairs of blocks. This has enabled block administrators to start using the meters as the basis of cost calculation. However, attempts to shift losses onto those without meters created huge disparities in bills and conflict between neighbours. The problem was compounded by the facts that there was no legal basis to discriminate against those without meters, and that the poorest members of society were those who could not afford meters and yet it was precisely those people that were being asked to shoulder all of the losses.

In autumn of 2003 the government further embedded the emerging chaos, by allowing block administrators to use meters as the basis of calculation, without providing a clear indication of what should be done with the losses. Rather than address the root of the problem, the government had allowed those with some measure of wealth to offload some of their financial burden upon the poor. Now that meters are being fitted to stairs you might well ask where are the losses? Surely a system of metering would encourage residents to fix leaky pipes and reduce such wastage?

Many residents have discovered that if you leave the tap running at a very low level continuously the meter does not register the flow, thus enabling you to escape payment. However such usage is captured at the water company's stairs meter, thus creating ìlossesî. In some blocks administrators divide such losses between all residents, thereby encouraging neighbours to monitor each others behaviour. However the more common practice is to simply shift the costs to non-metered residents, who have no measurable means of defence. Such problems are compounded by a practice of meter readings being taken by residents themselves, inevitably leading to the creation of fictional losses that are being stored up as future debts and conflicts.

Whilst all this has been taking place the water companies have increased prices and substantially reduced their supply of product to consumers, without any noticeable increase in quality. Furthermore, infrastructure improvements, such as stairs metering programmes have been heavily supported by EU grants. With few incentives to change, water companies are likely to continue abusing their monopolistic position for some time to come.

On a positive note, water consumption has declined as a result of the introduction of metering. Doubtless once everybody has a water meter many of today's problems will be overcome, but the suffering and loss of community feeling amongst neighbours in the meantime has been as pointless as it has been cruel. Most of these problems were quite foreseeable and could and should have been avoided had the government shown the slightest interest in the wellbeing of their citizens. Yet the introduction of metering itself has occurred despite the government, not because of a considered policy on this essential issue. The absence of any useful policy from the government on the management of drinking water has created chaos, conflict and caused the rich to squeeze the poor a little harder.

In short the water regime is a classic illustration of all the potential that Romania has to improve upon a bad inheritance, which in reality, due to incompetent, selfish leadership, leads only to further upheaval and suffering for the majority. Sadly, it is Romania in a microcosm.

Andrew Taylor runs Connect-CEE, an outdoor training company.